FSC Fights Porn Tax on Free Speech Lobbying Day

Calderon wants 25% tax on adult entertainment

SACRAMENTO - Free Speech Coalition has come a long way since it held its first official "lobbying days" back in 1996. The effort was then billed as "a three-day seminar to be held in Sacramento June 17-19," to include "a tour of the capitol building and a briefing on the legislative process, focusing on bills that are currently under consideration which will affect the adult industry. Depending on time constraints, participants will then watch the legislature in action, attend legislative committee meetings, and learn how actually to lobby individual legislators in one- (or two- or three-) on-one contact."

ADVERTISEMENT

Fast-forward 12 years, and there've been a few changes made. For one thing, thanks to excellent work by FSC's state lobbyist Matt Gray, the preparation for the lobbying itself has been streamlined to half a day, and this year, the Coalition attracted a full 55 participants, who were divided into nine teams with appointments on Monday to visit 90 of the state's 120 legislators - all to discuss the latest "offering" from Assemblymember Charles Calderon (D-Whittier), AB 2914, or more colloquially, "this year's porn tax bill."

Team leaders included FSC executive director Diane Duke, attorney (and FSC board chair) Jeffrey Douglas, actress/activist Nina Hartley, California ACE executive director Larry Kaplan, Prof. David Hall, attorney Michael Fattorosi, Wicked Pictures VP (and FSC board member) Joy King and actor Taliesin. While several of the junior lobbyists had been recruited from among the dancers at various California strip clubs, most of whom were dancing to pay their way through college, porn stars Mary Carey and Dave Cummings were also on board.

But lobbying day itself started off with another big change: FSC's annual press conference, usually held on the front steps of the capitol building, this year took place in the Governor's press room, on the same stage from which Gov. Schwarzenegger speaks when he holds press conferences in the capitol. At about 10:15 a.m., Duke, Douglas and Hartley addressed the shortcomings of AB 2914 and answered questions from reporters - including some about Mary Carey's future political ambitions.

Asked if she had plans to run for governor again next term, Carey replied that she thought she might like to work her way toward that job by running for something easier ... like for the U.S. House of Representatives or Senate, before tackling another run for the highest state office.

Simply put, AB 2914 is nearly a carbon copy of last year's AB 1551, also introduced by Calderon, except that the current bill would exempt hotel/motel adult pay-per-view systems from the 8 percent tax to be levied on the gross receipts of every "adult entertainment venue" in the state. However, even the definition in the bill of "adult entertainment venue" is deceptive. Such a venue is defined as "a retail establishment located in California with a substantial purpose that is the sale or rental of adult material, the premises of any facility located in California that provides a public or private viewing of adult material, or the public premises of any facility located in California that offers live sexually explicit conduct that is prohibited to audiences under 18 years of age or 21 years of age, depending on the sale of alcoholic beverages on the premises." That's fairly self-explanatory ... until one reads further and discovers that such a venue does not include "A retail establishment that is open to the general public and that segregates adult material by restricting access to persons 18 years of age or older, so long as the gross receipts from transactions involving adult material do not exceed 5 percent of all gross receipts of the retail establishment." [Emphasis added]

In other words, while some video stores (like Blockbuster) carry no hardcore material at all, the fact that the definition in the bill of "adult material" includes "harmful matter as defined in Section 313 of the Penal Code" means that any R-rated DVD that the store may carry, whose "R" rating is due to nudity or other sexual content, may trigger the tax if the store's sales of such material is 5 percent or more of its total gross sales - at which point the 8 percent tax would apply, possibly retroactively, to all sales that the store made over the course of the fiscal year. The same could just as easily hold true of stores selling music CDs with sexual lyrics, or bookstores selling volumes of erotic photography or sexualized romance novels.

The funds derived from the new tax would all go into a newly-formed "Adult Entertainment Venue Impact Fund," whose sole purpose would be to "ameliorate the secondary effects of adult entertainment venues." Just one problem there: No peer-reviewed study has shown that adult entertainment venues cause "secondary effects," defined (but not limited) in the bill as "criminal activity like the illegal sale of controlled substances, prostitution, and crimes against women," "negative secondary effects of adult entertainment venues on property values," and "related health issues, including the transmission of diseases and mental health treatment."

Of course, all that is in addition to the fact that it's unconstitutional to single out, for taxation, one form of (legal) speech and exempt all other forms of speech from the same tax.

And so, Free Speech Coalition's nine teams fanned out around the capitol, visiting with legislators and their staffs to discuss the shortcomings of AB 2914, and reports at the end of the day showed that the teams met with mostly positive responses from the officials they visited. While several of the Democrats pointed out the state's massive budget shortfall, FSC's junior lobbyists pointed out that the porn tax wouldn't help; all of its proceeds were already spoken for - bearing in mind that with no actual secondary effects to ameliorate, the money would just sit in the fund, assuming there were any funds left after administrative costs had been accounted for. Republicans, for the most part, having already signed onto the Americans for Tax Reform pledge not to vote for any new taxes, agreed that they wouldn't make an exception for Calderon's porn tax.

All of the legislators and staffs were invited to FSC's "legislative reception" later that afternoon at Chops, a local upscale eatery. The two-hour event, complete with drinks and hors d'oeuvres, was underwritten by Wicked Pictures, and attracted about 50 capitol workers.

It was at the reception that the attendees found out that, perhaps in response to FSC's efforts that day, Asm. Calderon had decided to change his bill: He raised the tax rate from 8 percent to 25 percent!

A hearing on the bill is scheduled to take place on May 5, before the Assembly's Revenue and Taxation Subcommittee.